Category Archives: opinion

This week on Facebook: I never paid a great deal of attention to the issue of forbidden drugs and legislation but age has not only enfeebled my body but also my brain. Some time ago my attention was caught by an article linking cannabis and ageing (the original can be seen here) and it was curiosity that drew me to read the article rather than any desire to smoke pot.

This week I had a conversation with an artisan who does some work for me, and he was making the case against the legalisation of cannabis. This started me thinking about the subject for another post. Is there a connivance by the government to make Aldous Huxley’s 1962 prediction a reality?

It seems to me that the nature of the ultimate revolution with which we are now faced is precisely this: That we are in process of developing a whole series of techniques which will enable the controlling oligarchy who have always existed and presumably will always exist to get people to love their servitude. Aldous Huxley

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This week on Facebook: Not that I am short of things to write about but sometimes even I get bored with myself and my tendency to rabbit on and on… Still, when I meet my ex-colleague for our monthly ‘pie and a pint’ we often discuss how little things have actually changed. Then we are both getting old and hold the geriatric view that the world is going to hell in a handcart.

Of course materially things have changed quite dramatically, particularly post WWII and especially for the following generations. Although I’m not sure that today Aaron Copland could call his piece Fanfare for the Common Man without raising a controversy. I’m sure that any such controversy would get a mention in the Encyclopaedia Britannica, unlike Copland’s sexuality. It seems that todays society has a predilection for declaring and writing about sexual orientation something that has yet to occur, at least in our conversation over a ‘pie and a pint’. But then it may all be part of a geriatric view that the world really is going to hell in a handcart.

Not so the epigram plus ça change, plus c’est la même chose, which is probably familiar to most of my generation. However, some of my family may read my reflections so for their benefit I will add that it was a somewhat cynical remark by Alphonse Karr translated as, “The more things change, the more they stay the same”.

In 2013 I came across The New Economics Foundation (nef) publication guide to the UK monetary and banking system with the title ‘Where Does Money Come From?’ contending that there is widespread misunderstanding of how new money is created. The original can be read here, implying that the only widespread understanding of ‘money’ lying in its purchasing power seems a reasonable conclusion and may compliment the monetarist viewpoint. Read more of this post

This week on Facebook: I have to think very hard about whether I am a monetarist or not, the answer seems to depend on how strongly I believe that the State guides its political economy by changes to the monetary supply and other forms of fiat money creation. It was an article or remark of Mervyn King in which he displayed misconceptions about money velocity, particularly with regard to quantitative easing, that first brought the Irving Fisher equation of exchange (MV=PT) to my attention. Economist vacillate over measuring Instruments in economics¹ and while I would hardly call myself an economist — I share in their vacillations. Read more of this post

Where does “plastic money” like debit cards, credit cards, and smart money fit into this picture? A debit card, like a check, is an instruction to the user’s bank to transfer money directly and immediately from your bank account to the seller. It is important to note that in our definition of money, it is checkable deposits that are money, not the paper check or the debit card. Although you can make a purchase with a credit card, it is not considered money but rather a short term loan from the credit card company to you. When you make a purchase with a credit card, the credit card company immediately transfers money from its checking account to the seller, and at the end of the month, the credit card company sends you a bill for what you have charged that month. Until you pay the credit card bill, you have effectively borrowed money from the credit card company. Measuring Money — M1 and M2

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This week on Facebook: I have posted a lot on the subject of money, often referring to Investopedia, the International Monetary Fund, European Central Bank (which is not a ‘central‘ bank at all) and the Encyclopaedia Britannica¹.

Holding the views I do about money and especially ‘the double coincidence of wants‘ problem, I now find myself torn between the notions of commodity money and fiat money. Of course whether or not either money has value ultimately comes back to the double coincidence of wants, this time being set by the Foreign Exchange Market².

The value of a country’s currency depends on whether it is a “free float” or “fixed float”. Free floating currencies are those whose relative value is determined by free market forces, such as supply / demand relationships. A fixed float is where a country’s governing body sets its currency’s relative value to other currencies, often by pegging it to some standard. Free floating currencies include the U.S. Dollar, Japanese Yen and British Pound, while examples of fixed floating currencies include the Chinese Yuan and the Indian Rupee. Foreign Exchange Market

The reasons for a State investing in another State’s money may be quite complex, which raises the question of if China’s wealth is in the free floating USA dollars debt that it owns, or the fixed floating currency of the Yuan. Read more of this post

Money, it’s a crime
Share it fairly, but don’t take a slice of my pie
Money, so they say
Is the root of all evil today
But if you ask for a rise, it’s no surprise
That they’re giving none away

Pink Floyd’s lyrics, “Share it fairly but don’t take a slice of my pie“, hold as true today as nearly 50 years ago when the song was written. A ‘slice of my pie’ is always the issue. In my post of 2011, I wrote that the war reparations of WWI that were imposed on Germany 100 years ago caused the resignation of John Maynard Keynes from the British delegation. In Keynes’ book The Economic Consequences of the Peace Keynes pointed out that the principle of accumulated wealth based on inequality was a vital part of the pre-First World War order of Society and ‘progress’ as it was understood then. Echoing a principle common in todays world that it is unnatural for a population minority to accumulate such huge wealth when so few enjoyed the comforts of life.

Perhaps it is time that the eccentric heroine of Christopher Isherwood’s novella Sally Bowles is resurrected — thought I doubt very much that any new terms will be invented for the inflation created by the State in a fiat money world.

Part of the fascination of Weimar Berlin lies in the mirror it holds up to our own time. In Cabaret, fictional Nazis beat up the gay hero and kill cabaret owners who dare to criticise, or simply to make people laugh at, pomp and stupidity. If the musical is at last being staged in a Berlin that never made much of Isherwood, then it may be because the producers want to emphasise alarming parallels. A newly vibrant German and European capital, Berlin today has record unemployment and recession is a returning threat. Some of the young have embraced the violent right, with its hatred of foreigners and permissiveness, and parade menacingly through the streets. Wicked joys (2004)

The best that I could do was to measure the value of one pound (UK) using three sequential periods from 1947 until 1970 and from 1972 until 2018. I missed out 1971 as it was the year that fiat money was introduced into the global economy. Even so the cost of inflation to the consumer for a basket of goods not included in the RPI or CPI indices was hard to identify. This is particularly true of groceriesthat are considered to be a necessary expenditure. Food is approximately 10% of the basket depending on the percentage variability of the other included items. The following notes below point out that measurements of inflation are based on a fiscal policy that is related to the RPI, CPI indices.

This week on Facebook: Any human thoughts on Theism present many different conclusions, as do human thoughts on the subject of Atheism and you must draw your own conclusions. To a certain extent the Inklings shared religious views¹, particularly on Christianity. Views that were certainly more prevalent than they are today, I mention this because their shared religious views was probably the glue that held the Inklings together, that and the friendship between C.S. Lewis and J.R.R. Tolkien)². Read more of this post